Uber for Business is ramping up efforts to gain more ground with corporate travelers. Its rival, Lyft, is doing the same. Have those efforts worked? Today (July 21), T&E firm Certify released its most recent analysis of the popularity of these alternative corporate travel service providers, examining the data from millions of expenses and receipts that flowed through the Certify platform in Q2. According to the data, the verdict is clear.
“Ride-hailing services leave taxis far behind,” Certify declared in its latest SmendSmart Report for Q2 2016. “It appears the ride-hailing trend has turned a corner, and for taxis, there may be no turning back.”
The first line of evidence in ridesharing’s favor is the significant uptick in traction gained by both Uber and Lyft. Lyft secured 0.34 percent of the corporate ground transportation space among Certify users in Q2 2014; this year, that rose to more than 5 percent.
But the most dramatic shift has been between taxis and Uber. In Q2 2014, Uber usage stood at just under 26 percent. In Q2 2016, it has spiked to 72.53 percent. On the other hand, traditional taxis have seen the opposite effect, securing more than 73 percent of the ground transit market in Q2 2014 but ending Q2 2016 with just 22.27 percent of the corporate travel ground transit space.
That’s a 51 percent decline in market share (among Certify users) in just two years.
“Our data shows the real-time transformation of the ground transportation category and how modern business travelers have wholly embraced ride-hailing services, like Uber and Lyft,” summarized Certify CEO Robert Neveu in a statement.
The cost of ridesharing services may be contributing to their positive ratings among corporate users. The average cost of both Uber and Lyft rides has decreased over the last two years, hitting $20.78 for Lyft and $25.48 for Uber by Q2 2016. Taxis, however, have increased their rates by more than 15 percent.
Car rentals are similarly in their dog days. The space secured over 50 percent of ground transportation market share in Q2 2014; by 2016, that dropped to 37.3 percent.
It seems corporate travelers just aren’t happy with traditional taxi services. Certify found that, in Q2 2016, taxis earned a 3.75 satisfaction rating (on a scale from one to five). Uber, meanwhile, scored a 4.71 rating.
Lyft, surprisingly, beat out the competition, earning a 4.8 satisfaction rating. Could Lyft soon see the massive growth spurt among corporate travelers that Uber enjoyed?
Certify analysis suggests it’s possible. According to the report, certain jurisdictions are witnessing a dramatic increase in Lyft usage by corporate users. For instance, in Q2 2015, just 2 percent of the corporate use of ridesharing services went to Lyft in Arlington, VA, with the rest going to Uber. This year, however, Lyft accounts for 11 percent.
Lyft has also seen gains in Austin, Chicago, Los Angeles and San Diego. In all, Lyft is growing at a faster pace among corporate travelers than Uber is, having secured a 176 percent increase in corporate travel use between Q2 2014 and Q2 2016 (compared with Uber’s 145 percent growth rate).
“The market continues to grow at an incredible pace, and competition is getting sharper and more sophisticated,” Certify’s Neveu commented. “I think what we’re seeing now is really the emergence of the kind of market forces you find in more mature industries. Forces that will invariably drive downward pressure on pricing, as well as an increased demand for new and better services in the future.”
“Ride-hailing was bent on disruption from the beginning,” the CEO continued, “and by the looks of it, there’s a lot more change to come.”